Q4 2020 Las Vegas Sands Corp Earnings Call
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Ladies and gentlemen, todays conference is scheduled to begin shortly.
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Please standby today's conference is scheduled to begin shortly thank you for your patience.
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Good afternoon. My name is Katrina and I will be conference operator today at this time I would like to welcome everyone to the Las Vegas Sands fourth quarter, 'twenty and 'twenty earnings Conference call. All lines have been placed on mute to prevent any background noise.
Now turn the call over to Mr. Daniel Briggs.
Thank you joining me on the call today of around 18 of our chairman and Chief Executive Officer, and Patrick Dumont, Our President and Chief operating Officer also joining on the call of the Doctor Wilfred Wong and <unk>.
And the Sands, China and Green zone.
Keith of Chief operating officer, the change John.
Before I turn the call over to Rob.
And remind you that today the conference call will contain forward looking statements that we're making them for the safe Harbor provision of federal Securities laws. The.
The actual results could differ materially from the anticipated results and the forward looking statements. And addition, we may discuss non-GAAP measures.
Definitions and reconciliations of the measured and the most comparable GAAP financial measures is included in the press release.
Please note the posted supplementary earnings slides on our Investor Relations website and May.
We kind of the slides during the Q&A portion of the call finally on those who'd like to facilitate the Q&A session the assets.
The Inspector request the limit yourself to one question one follow up so the.
Hello, everyone and with interest the opportunity to participate. Please note that this presentation is being reported.
Ill turn the call over to the.
Thank you Dan.
Good afternoon, everyone and thank you for joining us today on the last two weeks have been the most difficult and our company's history as even more and the loss was not under Sheldon Adelson.
Sheldon and as you know was the visionary he led the transformation of not one of three integrated resort markets and that being in Las Vegas Macao.
And Singapore.
The author of the mice space integrated resort model and Las Vegas, and pioneered the development of the Cotai strip in Macao and re imagined and the skyline, assuming the close of the Iconix database and <unk>.
And as our densities to challenge the status quo transformed the entire markets.
Las Vegas Sheldon originated the convention based integrated learning model for Nolan and I need.
We believe the viability and sustainability.
Larry and Las Vegas Convention on synonymous.
And the accounts, even forget our Sheldon division for Cotai, the slide the consensus thinking of that time.
Every element of the Venetian Macao is questioned by the <unk>.
And I mean every element of 3000 room, all suite hotel and <unk>.
Overnight and tourist market form of didn't exist and Houston hotel inventory with very limited the <unk>.
Turning to announce shops for the a 300 of retail stores and the market that had virtually no retail and <unk>.
15000 feet, the arena and <unk>.
One 2 million square foot Convention center.
During the day, but you also delivered who developed the critical mass for the World class integrate resorts.
Record speed.
But for others, and even dare to dream and complete the Venetian Macao and 2007.
For the fifth year of our Companys 20 year concession.
He is the termination of pushing forward the diversification and the investment and non DMV Macao was unwavering and breathtaking and be part of our total investment of channel today exceed 15 billion U S dollars.
And shown on the big believer of strong healthy and cultural U S China relationship.
He believes it was to the benefit of both countries and maintain a bilateral relationship.
Based on mutual respect.
The company the board and the family of absolutely committed.
The continuing efforts in this regard.
Sheldon is irreplaceable and visionary founder of our company of the unmatched portfolio of integrated resort assets and the management team. He assembled the operating expand the business and the future remain here in place day to work.
The DNA of the company and Sheldon and found it will remain at the prison.
The company with the full and wholehearted support for the board and the families will continue and honored Sheldon and vision.
The tech enhanced his legacy.
We look forward for the future, we do sort of a lot of confidence and optimism and while the pandemic continues to impact our business diversity. The I've achieved positive EBITDA and both Macao and Singapore and the fourth quarter and there is no doubt in my mind, our business will rebound the pre COVID-19 levels and the future in Macao the <unk>.
<unk> suite for season is now open.
And the first phase of London, Macao officially opened in February.
And we're very excited about the rest of unveiling of the London and the calc throughout the course of 'twenty one.
The change Chinese and well positioned to capture the rebound and tourism and the pandemic finally does subside.
We believe we've always believed there's no better market of our company's investment in the channel we were.
The continued investment and resort product.
There are two of our local talent and of course support the local community, which we are grateful to <unk> and.
And in Singapore, we remain very kind of long term investment and renovations, including both the upgrading of our existing facilities and the expansion of that property.
On the personal note I assembled and two decades of Michelle and had both the the fund and pleasure working for Michele and do the great inventories of great friend and I guess, what speaks volume about his generosity and decency, reflecting the decision to continue to pay our team members, even if the pandemic dramatically impact our business he was adamant that.
Team members continue to receive pay and health benefits, while the closing our buildings because of.
Abundantly clear of our business will be tampered for quite some time.
And the days since has passed and we received condolences for around the world and global leaders elected officials and business partners investors and customers.
And many of you joining us on the call today, and we are touched by the outpouring of support and we appreciate that and.
I'm honored and invited by the boards of the Las Vegas Sands.
Sands, China has become the chairman and CEO of both companies.
With the full support of the board and the family I will work hard and the outstanding team members of the management team to fulfill Sheldon and extraordinary vision I am confident and Sheldon was 1995 of this company will go from strength to strength for the future.
One final thought we turned the questions and look forward and the day, we can say yay dividends.
Operator, we're ready for questions.
Ladies and gentlemen, the money if you have a question at this time. Please press the star and then the number one on the telephone.
First question for we have Joe Greff from Jpmorgan. Your line is open.
Good afternoon, everybody for asking a question debt yet.
I want to offer my condolences to all of you.
All of that their mental and Rob and Patrick you were obviously, particularly clear.
The big locked and that and truly was out with one of the one of the time.
Thanks, Joe.
Appreciate that thank you.
But my question and.
And I follow up.
Focus on Macao and.
And when we kind of look back at what's transpired with.
Deviation for mainland China.
And Tim the cow.
It's obviously, it's been more slow the progress has been more slow then and maybe what all of the anticipated notice on some progress.
The other than the government, having the intentional gradual easing of vs.
And obviously dealing with this little tiny thing called the global pandemic are there any other policy issues.
The things that that debt, maybe weighing in on and visitation and other than just simplistically. The these are kind of being granted in conjunction with infection rates and debt commission rates and the like and then.
When you talk to folks in China, but what specifically are folks looking at of metrics.
And improving metrics take the sort of see it.
Further easing of tourist visas.
Our fortunes on both local and grant and the Goldman and ask them to address the question.
Gentlemen.
Yes, Brian do you want the chalk.
And once you guys as you take care of it yes. Please grant of Wolfe research.
Yeah.
Yes, good good afternoon, everyone.
I mean, Joe I think following the resumption of the visa issuance from late September.
The business volumes clearly did rebound during the fourth quarter.
And the recovery was led primarily by premium mass and luxury retail.
I think both the both segments actually did show.
And good momentum throughout the quarter so in December.
We had.
A very encouraging month, especially the the holiday season.
And we reached over 50% hotel occupancy during the month.
And there were the peak days, we were achieving.
And half thousand 9000 room nights.
Which obviously, we haven't done and we are close to that since January.
And if you look at the the pace of recovery and retail.
And the luxury retail sales.
Really took off during the quarter.
And by December of four seasons of retail more was up 16% over the prior year actually we had the best ever month that we Havent had.
And for seasons more tenant sales so.
So thats pre and post pandemic of record months.
So and issue here is what you referenced.
And that there is just not sufficient visitation.
The power all segments of the business.
And to replace the volume that we lost the.
And the base mass remains very subdued.
Macao only had 20% of the prior year's visitations during the fourth quarter.
So really there's not a lot you can do about that it's not it's not a policy issue and the sense of.
They can do something.
Now that they would not otherwise be doing.
In light of having to prioritize the control of the pandemic and obviously the authorities have done an excellent job in that regard. So what you have to remember is that during the fourth quarter.
Go ahead.
Of many outbreaks local cases and different provinces and cities in China.
And in October and November they were relatively muted and even for the first half of the.
So the number of the zones of districts that were classified as medium to high risk.
And from a Covid perspective.
The relatively few.
But from about let's.
And let's say third week of December of the domestic cases stopped and started to rise in the northern China and.
And what we saw was that a lot more districts and lot more zones and <unk>.
Sometimes to host cities were classified as medium to high risk, which he made to the obviously puts a break on visitation from those affected Sullivan of cities, but also the overall narrative and travel advisories related to Covid.
<unk>, obviously, a lot more cautious and that impacts forward bookings so from about mid of December.
We're up to that point.
And getting very positive momentum.
In terms of forward bookings and January and obviously into Chinese new year.
Obviously things that start to moderate from a forward booking and.
The pace of new bookings and obviously, the the increase and cancellations. So that that is directly related to the trending of the pandemic and some of these isolated outbreaks that we've seen particularly in the northern provinces. So with that in mind is it's not easy.
To see relaxation.
Of the current.
Guidelines in terms of travel.
Okay.
That's helpful.
And then all of the.
A follow up just I guess more on <unk>.
And the continuing this idea of of Macao policy.
And then maybe this is a question for all sorts of anybody on our call cancer, but do you think either Macao of the central government day, showing what mainland Chinese companies getting involved with.
The Macau casinos either.
The existing buy and existing states are having board representation.
The something that the priority for the government of important have there been discussions.
And I kind of remember hearing something along those line can be a couple of years ago.
Potentially happening on the ground and Macao, a couple of years ago, and we're getting more questions and commentary on net of late so anything you can shed on that would be interesting. Thank you.
Well the.
Grant or Patrick on the jumped on it.
Yes, I think.
Obviously, we have not been told.
Of anything at this stage.
The consideration is now being given to what the conditions should be for the new concession.
We have not picked up any of it and I'll have we'd be consulted on.
And whether that should be.
Got.
Participation of Chinese companies now, but we have to bear in mind that.
The Chinese companies on.
Unlikely.
Chinese companies.
Likely to take part in the company, which and China is considered not vehicle. So.
And there were in the past some suggestions of people, saying state owned enterprises might come in I don't think this really.
In line.
For the policy considerations.
The private Chinese companies.
And would be allowed to.
Participate in Macao and under what circumstances piece of things that have not been approached to us at all.
So the only thing I can say at this stage is that we will continue to fast and Macao and shows that.
A locally rooted company b.
Costs were listed on the stock exchange and Hong Kong. So we were just the same as any Hong Kong company.
And that we do everything.
And then.
And the other competitors.
Joe can I just jump on and we'll be very very thoughtful comments, we can go into the Beijing per annum, and 20 years, and Macao and having the endless meetings and I know, there's an outsized belief by some people write these things and the concrete opine.
Thoughts on how equity should be sold joins companies and the jumping up and down net.
And we've had the conversation to one person who mattered whoever said that to me.
And I comment in fact, if anything the kind of chuckle because of what was the comment does not is not the appetite to invest and gambling.
So I think those kind of I know, it's very prevalent and the market on <unk>.
And quite a bit I know somebody wrote the recently about how of the guarantee of licensure and we sell.
The X percent is also on the very good the one thing no one's ever said that some of the government to us never heard that and anybody actually understand and Thomas channel and Beijing operate in fact, I think what we do here is complete.
<unk> of what Sheldon has always done which is invest heavily invest heavily and non gaming.
<unk> Bill.
And believe in Macao supports your employees and.
Digging grow and Thats been the exact direction for it for at least the last five years and look for that you heard of multi and the Macanese officials. We've never heard of some thing you kind of saw steaks and Chinese people for we've heard the key support your employees Sheldon do debt towards T. We paid everybody through the pandemic of course, a lot of money, we did invest in Macao I think Sheldon.
We've covered that and the $15 billion invest and non gaming that's always been the direction, but not one time no one on.
Never heard historically only here at the speed of light. These columns are have a belief that they understand the thinking over there I did want to do the very very good person very important guide and the Chinese world.
And I suggest that some of these are the ramp and he said no one of them to buy into the Chinese gambling company was Macau and Las Vegas business and how we're going to do the job of what kind of humorous actually so I know that the common prevailing the thought but we don't view it.
Great. Thank you guys.
Next question do you have.
Carlo Santarelli from Deutsche Bank. Your line is open.
Hey, guys. Thank you for taking my question and I on Echo Joe's sentiments about the recent loss.
And just thank you for your kind of the call and due to US. We appreciate what you wrote and drilling time and thoughtfully.
Got it.
Thank you Rob.
And I could just very simplistically.
The Baxter for your understanding how should we expect the success of renewal process to actually get moving and what are you guys.
And the timeline to where potentially we could start to see some announcements as to the process and the timeline for the process and et cetera.
<unk> for them.
And we returned back to the sellers in Macao I think the best suited to answer your query and will for grant.
Yeah.
We are eagerly waiting for the government direction.
Because as you all know we only have about 17 months left for the concession expires.
And we only know that the government is adopting.
The process, which includes public consultation on the pro.
<unk> of the concession, yes and.
And the pockets of achieving diversification.
And that.
The amendment to the legislation has to be introduced into the let's.
And that just state of council and the.
Then the.
The bidding cross sets the kits. So it's a very tight timetable that we are running against.
We also know that there is a legislative council election scheduled for September.
This year. So all of this are coming and to play and we are.
And coming up against a very tight timetable.
We don't know where the.
This will be begin very soon.
Because right now the government is all and promote and the fight against that Ken and Dan.
Okay.
As we all know Macao cannot afford a single case because it was.
Public announcements by the government debt if there is.
Even one case Macao would be locked out again, so the government is putting all of the energy into the fight against the pandemic to ensure that visitors and continue to comp so.
And.
We don't know the computer.
So we don't know and when asked about this publicly the parts of the chief executive.
Said that.
Anything is possible I think he was asked where the.
And that could be on extension how should this be done and.
The response was anything is possible.
Great. Thank you very much that's very helpful. And then just as a follow up obviously.
Last quarter, you guys talked a little bit about the Las Vegas asset potentially.
So being open to entertaining offers for that asset.
How much Rob of Patrick the does that influence potentially debt the timing of the return of the dividend or do you think more about the dividend from from the land with the.
A cow is back and Marina Bay Sands is back and doing what they do.
You'll be able to tighten the reinstitute debt.
Patrick It's Scott.
Patrick So a couple of things we are of very positive view on Las Vegas, I think long term, it's irreplaceable in terms of tourist destination.
Huge amount of investment going to Las Vegas, we think theres, a huge amount of potential pent up demand just looking at other markets. When we kind of return and really the restriction of Las Vegas now are based on the capacity constraints set by the government on <unk>.
Weekends, we're actually doing quite well there are days, where we're actually almost at 2019 slot levels. It's really it's an interesting thing to see and I think we're very positive on Vegas outlook.
Generally that being said if there is if there is the completion of the sales process it didn't it.
And on the dividend I think the key thing for US is that we need to see of returned to operations. We've had this discussion before on prior calls we need to understand what the cash flow and trajectory of the businesses the growth of that cash flow trajectory you've heard grants mentioned the the completion of some of the London, Eric milestones, that's a phenomenal product and we believe it will be very cash flow generative and the.
Quarters and years to come as it addresses almost profitable and powerful segment in Macao and so the way we will look at the dividend is evaluate our cash flow trajectory and the profile of the business and then make an assessment about how do we start it and sort of what did you actually of that give it I would look like but we're very focused on the return of capital. We think it's been fundamental to our shareholder return story.
We think we have of growth component and our key markets, we have the growth component and.
And new growth opportunities and new developments and I think.
As part of that we look very heavily towards the dividend because of our cornerstone and of course the share repurchases as well. So we're very focused getting on the other side of the pandemic hopefully we'll see some some positive for the upcoming quarters. We have some green shoots in Macao, we had some positive results and Singapore and the positive results and Las Vegas here and so I think over time, we'll have better visibility on.
So the trajectory of the business and then make an assessment of of the tightening of the size of the dividend.
And Joe on the call is closing on the quality the passions and one other issue of that and that is the return of Las Vegas and Theres been recent commentary.
Been fun to read about how Las Vegas will never return to pre pandemic levels. The best day is behind us.
All of this before the last two three years about the town right now on the back foot. There's no question about it struggling but you cannot the thing the missing.
The vaccine or whatever it's going to take the fixed this problem and someday.
And when we sort of do we believe Las Vegas has plenty of the plenty of guests and thank our demand for 'twenty. Two 2017 convention is unbelievable.
Customers want to come and we remain very bullish on the return of Las Vegas and May take long once it may take for the end of the tiers and see the inflation spike, but please don't be among those people who have used.
Ideas that the spin day mix that sort of.
And Las Vegas, and just the opposite the demand and there will be there is a unique of town and they can have all of the digital products and offer you want people want the visitation and the turns left off of those so we remain very bullish on the return postponed and.
Yes first of all of Robyn and thank you for that and obviously I'm sure. There are a lot of us on this call are looking forward to pick and not taken on X trip out there I know I am. So thank you guys, Greg reported to have and.
Looking forward the Avenue.
Next question will we have Thomas Allen from Morgan Stanley. Your line is open.
Hey, and <unk>.
Let me also semi conductor to you and the entire all of you at the Dallas and family.
Michelle it's one of the true visionary and his successes and will never be forgotten and so.
Thank you.
Thank you the economy.
So there've been a number of reports and the media over the past few weeks and months about you looking into sports fan of online gaming opportunities can you just discussed during the strategy there and the bad more detail.
Sure and we're looking at a few opportunities the multitude of opportunities by both regional and the U S and yes, we looked at the deal.
And it's interesting you can't deny the tap and visuals quite of the space and we are on exploring opportunities looking what might be out there, but with the caveat. There is nothing to report today. There is nothing concrete we're simply looking learning observing and just the there's been some commentary that it's my suggestion and I want to assure you that.
The Sheldon this is another peculiarity of Sheldon easily was ethically he understood digital maybe too well before I did and he believes in it.
Simply of the outs outside at the.
At the low concerned about people couldn't afford it for people that are too young views of it and it wasn't a believer and the technology.
And that he never question the vulnerability of the question the ability to police it properly and so the same way you paid people hundreds of millions of dollars last year, we wanted to it's and ethical consideration of the shown so we've had this discussion prior to the the passing and northern explored and again. The caveat is we are in the making money.
And there is a wait and make money is intelligent and prudent and we and again Sheldon would be in the room, saying on the laser focus on the terms and growth as you know no name of GE for growth.
And even.
Obviously, whether it be and and the U S grew on the build more things and not leaving the U S where we want to build the <unk> been all of the pay for looking at different markets. So, yes, New York and the multitude of considerations. We are learning and we are observing in Tulsa and the people. We are nowhere near the decision on that and we will keep you apprised of something change.
Yes.
Thanks, Rob and then and then just talked to you about U S developments on the brick and mortar front on that.
And then some chatter about New York and Texas, What do you think the chances are those states and then.
How would you expect the kind of how would you like to reposition and those markets.
Well, we've been looking at New York for I think about 100 years. It seems like we are.
And I don't think of any secret and we're big believers in New York.
We think of extraordinary the density of population, the Mississippi and get them.
And already good opportunity for anybody and you can see the I think it's almost the.
It's close to $2 billion right now just on the facilities are there without the table gains of decent rooms and.
And a very good product a good product there would be extraordinary so we're definitely and the hunt we've been pushing and for again for us for five years for it.
Cited by the came out of the.
New York Group last week in terms of what the impact considering the zone and find out there. So we're leap and on and looking serious and New York on the whole bunch of levels and.
There's still a long way to go look for you understand where they want to build and what they wanted to go but we are going to be bidders and it's real and it's.
On properly we think the returns could be Sheldon lunch.
So that's interesting on the texture of the obviously extraordinary market.
And the entire zone, there too and.
Another extraordinary market and you cant deny and the power of Texas, the size and scale and.
The last week and it was the best meeting couple of days and again, we're having conversations we're looking and kicking the tires and.
We will advise you on something emerges and Texas It would be of great casino market for land based on whatever it could be a huge opportunity.
And these are opportunities that we would obviously the balance sheet strength, we were jumping with both feet on the right the structure.
Thank you.
Yes.
Next question of Wow.
Robin Farley from UBS Your line is open.
Great. Thanks, very much and just echoing everyone else's thoughts about how some of it is true.
Paul will talk to all of them.
Thank you.
Just two follow up questions.
Due to the sale of the Lvs assets.
The Vegas assets, you mean not.
Because of the dividend, but just kind of how much of the priority and is is it where you just kind of you answering and incoming cash.
Or is it something where you see that there may be some strategic reason why EBIT.
Okay. Thanks.
Sure.
So I think from our standpoint, we're very returns focused.
As Rob just mentioned, we're always looking at new opportunities and always looking at our portfolio to see how we maximize shareholder returns.
And so that's and entrepreneurial company.
We're always active so I think.
I think we should just look at this is if there's a way to maximize shareholder returns we are going to do it on.
And.
We constantly look of the assets that we have on our portfolio. We look at new growth opportunities as Rob just mentioned and we talk about them. This is how many of our team is very focused on so that's really how we think about it.
I guess, if I could push a little more and I guess for what kind of on the appetite did you sense many of you.
Sort of publicly confirm debt, which may be with the rights and interest.
Appetite and.
And you mentioned sort of being returns focused but almost anything that you would be interested in new York or Texas or kind of places.
Kind of project specific financing so it wouldn't necessarily.
You don't need the capital to free up to sort of put to use and any other markets. So I guess.
Trying to think about.
What kind of.
And this environment.
And what kind of appetite you think there maybe for the half.
Thanks.
So I think there's a couple of different couple of different questions. There. So.
First off I think the way.
Do we think about our portfolio is we sort of evaluate projects on a case by case basis. So Las Vegas is the Standalone entity, we've operated for a long time.
And we think it's of great assay, we think there's a great future.
And so obviously, we're focused on operating at this point.
The in terms of if we have additional capital to deploy as you know, we have and expansion opportunity and Singapore that we're very focused on and.
And we think Singapore is just a very special market. Its privileged the fact that we're there we love Singapore and thank the future for Singapore is very strong both at the leisure and business towards the market and we're happy to have helped the government there of supported schools and continuing to invest there. So we of capital if we could deploy the or in the near term.
I think in terms of other opportunities you hear somebody think that Rob is talking about we also had a return of capital consideration. So for us on capital allocation is front and center. We have these discussions with the management team and the board all the time, so it's something where we will look at our opportunities look for a way to maximize shareholder returns and we have assets, where we think our returns are increased by.
On transacting will transact and otherwise, we'll look to the sort of historical actions that we've taken in order to enhance returns and the near term. It is also helpful to have additional liquidity.
So I think from our standpoint.
And the pandemic recovers its nice to have additional liquidity on the balance sheet, which is the reason why we're running the amount of liquidity that we have today right. We want to make sure that we of the opportunity to do whatever we need to do during this sort of unprecedented time. So I think from that standpoint, that's kind of how we think about things I hope this answers your question.
Rob and just to piggyback on the accounts of one thought and that is.
Obviously, we have the very strong balance sheet, where we sell of Las Vegas or not but we also have I believe the next couple of years as you know 2000 and team did about $5 5 billion of EBITDA I know the miserable years of 'twenty, and perhaps even 'twenty, one and make that seem like a distant memory, but we need and comes back and comes back strong. We also I believe and Macao makes it does.
Vision theres going to be a requirement to invest more in Macao, which is Sheldon built where I can't weighted investment of 510 billion and that's a very in my opinion.
The Macanese government makes a decision I think will be contingent upon a rather substantial capital investment, which we know exactly what Sheldon.
That was both hands and that may be something else do you think about there's just no place like Macao and grant and we.
We'll forgive the expense and London for the season. The hope we can all be the this you will see what that team has achieved but we're not done in Macao, we can be there for many more years.
When all of us get the way it goes away probably later this year and Nick whenever I don't know I'm not the predictors of enrolling before it won't be long agenda. They won't make a bet, but one thing will happen in the accounts government is going to necessitate the licensees make investments in Macao, and we won't be there'd be ready Patrick referenced Singapore and Ethernet.
That small investment and the one billions of dollars. So I think we ask the prepared for outside of investments and the best markets with farm accounts and the forward for Crazy growth and then there's the other possibilities and the U S and reference so strong of the arm.
The strong.
Okay, great. Thank you very much thanks.
Next question, we have Stephen Grambling from Goldman Sachs. Your line is open.
Thanks for the question and condolences to everyone on the line.
Thanks, Steve.
On for gypsum.
Absolutely Mike.
First question is on Singapore, which has continued to be remarkably resilient and what are you learning from the recent results about serving domestic crowd that might inform the renovation plan and then just.
Thinking more comp and the potential ROI on these investments.
And then ultimately required for recovery in China consumers.
Well the first thing is the reserve.
And found that the Singapore is remarkably resilient.
And the slot business there is actually not quite the pre pandemic levels, but it's getting close so we learned that there is of local market, but more important and the local market frankly are the outsized contributions of the foreigners residing in the during the pandemic of full time, and Singapore and a lot of strong play inside of the country from wealthy.
People that want to Gamble and Thats, the very positive sign and you saw the numbers that we can run even though it's not the $1 billion seven who used to the north of two or three or four we'd like to be on it is still a run rate of half of 1 billion plus dollars and the most dramatic times all of those for me is reinforced to US all day and powerful Singapore, a wonderful of the asset and frankly the wonderful.
The government is to work with there in terms of there.
And so willing to talk and work with us and we're hoping to get actually low there in March to continue our discussion.
These two going but and reinforces the the enormous size and scale of that market and the think about having no foreign visitation yet.
And that kind of money and perhaps even more is very encouraging on the flip side. You also it makes you also importantly.
On the island.
Hampered by the fact, unlike the Macao, which could open the doors.
Governments, so chose and relax the visitation requirements and Singapore and the government has opened the door.
The Air list, which means the counterparty trading and though the government's other airlines. So we don't see the claim that in the short term and these days and the $150 million quarter sales level and.
So theres no real growth opportunity I think the see it until this day.
Issues resolved, but it certainly makes us very much want to invest and Singapore is a great place to do business.
The greater market, obviously need and return of all consumers and foreign consumers to enhance it but the we want to invest money and seeing and believe we should do we should we get on the product better we had a lot of work in the building right now we're actually embarked on the ambitious and the investment programs in the current asset to bring up the better standard and then we want to build of our second.
And some of the resolve of everything so we are just like in Macao, We're lucky to be there and the idea of we can do $5 1 billion per.
Pandemic is pretty encouraging can be more we think we can do a lot more yes.
And maybe a follow up on digital and I gaming and I realize it's still early and you shouldn't have been studying the industry, but are there any initial thoughts on what you think the company can bring to the table different and the existing players.
I have very strong thoughts about but I want to talk about them at this time I want to keep working towards our goals, which is on the scene that fully complete the conversation and frankly, the tutorial undertaking and understand how to get the it's a very interesting business as you know it doesn't make a lot of money, but it sure has great valuations of the question is can we bring.
Some of the table would make a lot of money and we're working through it and we are.
Exploring as best I can tell you we of something.
Concrete the safety, we'll certainly call it right now it's simply historically and the same language for a lot of things all the time.
The Thailand.
Someone came out about the possibility of the of.
The two of the Iron, Thailand, and we're exploring that as well. So everything is up for grabs I think we look at our company.
The the balance sheet enables us to have a really curious appetite to grow and again, we're going to adhere to the founders.
Gary growth Adelson.
I believe in it and we're certainly going to adhere to that and I think you'll hear some things must hopefully the next.
The next 12 months that will make.
And if you believe in that idea.
That's great. Thanks, so much and.
Next question, we have Shaun Kelley Bank of America line is open.
Hi, Good afternoon, everyone and I also went off of my condolences to you Rob Patrick to the whole adelson and Las Vegas and families.
Thank you appreciate you and thank you very much.
And I guess I'd like to turn it back to Macao for a quick and if we could.
No.
Grants comment to start off as a little silver and about sort of expectations of when we can start thinking about a recovery relative to kind of what's going on with the pandemic in China and.
If we step back for a second and maybe it's a little harder for us over here, sometimes the monitor exactly the nuances of some of the vaccine development for one thing thats increasingly separating the U S recovery narrative from overseas is it's probably that to some degree. So I was wondering if we could get a little bit of of thought around maybe some of the vaccination.
The programs and what the expectations are around that for the.
The within Macao.
Broader thoughts on the local area, there, possibly Hong Kong and then and then how that could branch out.
To China in terms of is that what we may need to take to really see.
More concrete reopening for the entire market at the stage.
And the silver and Mr Chung for awake.
Yes.
And I think I think Sean Firstly, we have to stand back and look at the domestic Chinese economy.
During the course of especially the second half of 'twenty and 'twenty. So.
And is different from the western economies Las.
Largely the domestic economy was recovering very strongly so this is without.
Obviously the vaccination.
Being applied to the whole population and <unk>.
And obviously attributable would see.
The fantastic the control of the pandemic. So as you look into the fourth quarter you are getting the six 5% GDP growth in domestic China.
Without without the vaccination. So that's a very very strong outcome and obviously the consumer is getting stronger across the board. So I think we have to look at China and slightly different way the.
Strategy is to continue to control.
The two basically zero and local cases.
And for.
Whether that is achieved through vaccination and whether that is achieved through what they've already been doing.
And clearly there is a path either way.
The two clearing the.
The the low.
Locations and the localities from the virus that will enable.
Travel.
To resume on normally between mainland China and Macao, So I think thats, the first and most important point.
In terms of the vaccine strategy.
Locally.
<unk> seen.
Comments from the local governments of both.
The us both Hong Kong and Macao.
Both have a strategy to procure a number of different vaccines actually three from three different providers and both cities are looking to procure.
On the first batch during the first quarter as we understand so sort of the local populations.
In the sales.
I'll also be the.
And B looking at the vaccination program in the months ahead.
But really the most important thing is still.
Strolling the pandemic in terms of the local cases in.
The <unk> China itself.
And if macao than can be part of.
The domestic travel bubble in the bigger way and an easier way and a more.
For fluid way than has been the case.
Up to now then obviously.
On the tourism and the consumption spend will come back very strongly.
And there has been progress.
Think.
Obviously, it's from a low base, but there has been progress there has been a gradual.
And easing up of the logistics and the getting used to.
Some of the guidelines throughout the course of the fourth quarter, but again the central point is.
As the worldwide pandemic got worse in the winter months are more imported cases that leads to more isolated outbreaks and some of the provinces in China, then obviously that puts pressure on the restrictions again and the travel advisories that issue by various different local governments.
And entities, especially prior to Chinese new year, which is as you know a huge.
Period of huge migration of the population and travel so so that obviously rightly.
Yes.
And some some consideration from the from the perspective of the authorities debt that we need to be very careful at this stage, which is very delicate.
Again, another important point is as the pandemic, obviously, if it subsides and the rest of the world as well then then that imported risk reduces and that obviously relieves the pressure inside China as well, which hopefully is another factor that would lead to the normalization of.
Of the travel between between Macau and mainland China.
That's helpful. And then maybe just as a further follow up on this is probably maybe more for well for and if he is still on but last quarter. There was a little bit of commentary about the overseas the gambling law and I think we're approaching.
A little bit more of closer to kind of point of probably both where that where we know it's more things about that line and also its implementation, which I believe the set for March one. So just wondering do we know anything more about that today than we do before any on.
Changes or additions to that debt debt, we should be aware of.
Yes actually the.
The amendment to article three of three of the equipment of law has been and.
It was enacted.
About two weeks ago.
And as you appreciate this law.
<unk> sales with people organising gambling running casinos and.
And particularly organized.
Citizens of China to go outside of the country to participate and gambling.
Now there were the nectar version two of the changes of the previous dropped.
First the definition of the criminal Act.
And they try to come up with the definition was removed. So the tests used a catch all phrase of whoever organises.
So this is.
To avoid people, arguing who falls into the net.
The second change appears to be a bit positive.
But the still ambiguous for for Macao is that and the legislation they specifically say.
Outside of the country.
Which as you all appreciate Hong Kong, Macau, and Taiwan is generally considered within the country.
And that is the leaf.
And.
And then because.
With T there by putting and what offshore inside of the bracket after outside the country.
About this.
Introduces the ambiguity and I was discussing this with both of our lawyers and paging and.
And the and the.
The local MPC National People's Congress.
People attending the.
Session and they said that while the central People's government recognizes the special status of Macao day.
And would not want macao to be exploited.
This for.
Organizing such activities to take people outside of the country.
Such as the southeast Asia countries and.
As we all know the ministry of tourism as compiled and is.
Piling.
Black list of countries to which they are known to be accommodating.
Gambling from Chinese citizen so.
To us there is such and ambiguity, which will ultimately be decided by the authorities and of course going forward.
But at this stage and it's.
And for sure.
And any.
And all.
<unk>.
Tried to use Macao as the base.
Two to organized gambling to other countries would be would be condemned.
Thank you for that.
Thank you for the question Tim.
For the last question, we have David Katz from Jefferies. Your line is open.
Hi.
My condolences as well on.
The.
The best part of this job is always the truly extraordinary people and we get to meet and.
And you would certainly the treasurer and fun.
For sure that's sort of true people. The one thing I missed the show me the humor, everyone talks about anything else, but he was the love the lapping of the good time and even seniors day and this does humor the door.
What's your question David Thank you for your comments.
And look I think one of the slides in your deck.
And it suggests or implies that some of the rolling volume that's gone away as and.
Recaptured within mass premium mass.
Among all of the unknowable.
You've done your best to address on.
Are you able to look into what you have and the premium mass.
And measure how much of that is recapture of potential VIP dollars and.
What what is your best cash about if you were sitting down to model one.
And one to four years out.
You would think about modeling.
And just given where we sit today and that's it thank you.
Brand.
Yup.
Yes. Thanks for the question, David I think structurally and this is not to do with the pandemic structurally we've seen obviously the the.
Power and the growth of the premium mass over the last several years and.
And that trend.
Is this going to continue.
Where the whether it's pre pandemic sharing and after.
And the reality of that is because the players the customers.
They want to deal directly with the owners of of.
Operators of these great assets and on.
Honestly, the great lifestyle destination that would provide the.
The the multitude of amenities and.
And the services that we're able to offer.
Very very appealing.
So I think that will continue and so youre right.
<unk> two is.
The transfer from one segment to another I think structurally there has been over the last several years anyway.
And Thats, one of the bread and things about Sheldon.
Integrated resort model is that we can offer everything from the entertainment the retail to the food.
Food and beverage and the spas and all of these non gaming lifestyle amenities.
And that trend is structural and Thats why we strategically invested in products that's of.
The segment.
Specifically, what's happening now.
On the situations.
You referenced is more related to.
Issues.
Specific to.
The system and the junket.
Segment.
And that has that has stabilized.
Low levels of volumes.
And obviously as a result of some of those issues.
And may see that as new demand resurfaces and regimes in the coming years that that new demand is captured directly by the operators rather than through intermediaries that also is true.
But I think the overarching trend was that before any way and would've continued in that manner.
Just that what's happened and the last 12 months made some will accelerate that trend.
But it was going to the big structural trend and drive the for years to come anyway.
Perfect. Thank you very much.
And you did.
Okay.
Ladies and gentlemen, that's all the time that we have for today. Thank you all for participating you may now disconnect.
Yes.
Okay.
Thanks.
Okay.
And.
And mainly.
And.
And then.